Dikta Ekonomi Jurnal Ekonomi dan Bisnis

MARKETING MIX STRATEGIES OF SELECTED

TRAVEL AGENCIES IN MAKATI

Hadiati Fitri
Faculty of Economics
YARSI Universitas

Abstract

Penelitian ini dimaksudkan untuk mengetahui strategi bauran pemasaran dari industri travel
agen. Empat variable digunakan dalam penelitian ini yang meliputi : produk atau jasa, harga. promosi
dan tempat. Untuk mengetahui intensitas strategi kita mendefinisikan tujuan atau objective dari keempat
variable dan strategi yang dipakai dalam mencapai tujuannya, kemudian melihat masalah yang
dihadapi dalam pelaksanaan buaran pemasaran itu serta memberikan alternative pemecahan masalah
untuk memperbaikinya.

Kata kunci : Bauran pemasaran, travel agen.

INTRODUCTION A travel agencies is a place where a

The past decade saw a decline in the
growth of the tourism industry of the county.
The following factors accounted for this
decline: slow down in the economic activities
of major markets such as the United State and
Europe; series of national disaster which
activate major internal problems in the
country; worldwide inflation which affected
international travel.
Endowed with natural resources,
warm people and majestic scenic spots, the
country’s potential as a tourist destination in
Asia is not far-fetched. The need to
coordinate
effort among allied sectors and agencies
become important to achieve the goals.
Responding to this call, travel agencies started
to design programs geared toward improving
their operation. It is in the light of this major
development in the tourism industry and the
pivotal role travel agencies play in this
development that this study is undertaken. It
is believed that in that
in the light of this new thrust, the travel
agencies will bring forth a new dimension in
these operations.
person can secure information, expert
counseling, and make arrangement to travel
by land, sea or air to any point of destination.
Like an independent insurance agency, a
travel agent represents many different
suppliers’ airlines, steamship lines, tour
operators, hotels, and sightseeing companies.
The agencies staff impartially recommends
the best suited to his clients’ particular needs.
Thus, the agent is primarily a travel counselor
for his clients, although he is also an agent or
broker for his supplier. He is an agent when
he has an official legal appointment-contract
such as with a public carrier. Oftentimes he is
a broker representing hotels, car rental, tour
operators, or sightseeing companies which do
not have formal appointment contract
(Brownell George, 1990 :1).
Today, the travel agencies became
very competitive in the market. In the past,
its product knowledge and enthusiasm were
enough to generate travel sales but now
marketing skills are necessary ingredients for
a travel agency’s survival and growth.
Marketing has its origin in the fact
that humans are creature with needs and
wants which are satisfied by acquiring
product. Since products can satisfy given

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needs, the choice is guided by the concept of
value and expected satisfaction. Human
society obtains these goods through the
medium of exchange, which means that
people become specialist in the production of
particular products and trade them for other
things they need. A market is a group of
people who share a need. Marketing
encompasses those activities that represent
working with the markets, that is, trying to
actualize potential exchanges.
Marketing becomes one of the very
important in the department in the
organization, since it works closely with
detailed planning of product and distribution
of service goods. For some business like
travel agencies its success rest entirely on the
marketing department which has to put up
some financing schemes, among others. The
success of such organizations rest on the
effectiveness of its marketing department.
The same is true for many
organizations and in this case, the travel
agency is no exception. Marketing
department is tasked with the duty of
understanding and obtaining information on
marketability of the product or services to
insure their distribution and assimilation in
the market.
However, while the different types of
organization have marketing departments
there is no single form of organization for the
marketing function. Rather it is said that this
is dependent on the organizational form, on
the size of the company itself, etc
The problem of organization for marketing
departments is not much felt today because
the emphasis center on the task of marketing
management. Theories have come up with
conclusions that the task of marketing
management is the quest for information
which led to the consumer’s satisfaction on
the presumption that customer is the central
focus and concern of all organizational
activities.
Kotler (1997) mentioned five alternate
philosophies which can guide organization in
carrying out their marketing activities. First,
the production concept holds that consumers
will favor product which are affordable and
available, and therefore management’s major
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task is to improve production and
distribution efficiency and bring down prices.
Second: The product concept holds that the
consumer favors quality product that are
reasonably priced, and therefore little
promotional effort is required. Third: The
selling concept holds that consumers will not
buy enough of the company’s product unless
they are stimulated through a substantial
selling and promotional effort. Fourth: The
marketing concept hold that the main task of
the company is to determine what a chosen
set of customers needs, wants, and prefers
and to adapt the company to delivering the
desired satisfaction. Fifth: the societal
marketing concept holds that the main task of
the company is to generate customer
satisfaction and long-run consumer and
societal well-being is the key to satisfying
organizational goals and responsibilities.
In developing a marketing strategy, the most
important part is to develop an effective
marketing mix. A marketing mix is a
particular combination of techniques, tactics,
and resources designed to achieve the
objectives of the marketing plan, and it covers
the four variables over which the marketing
manager has some degree of control: product,
price, place, and promotion. The skill of the
marketing manager lies in understanding
how these variables interact, and in spreading
the company’s marketing efforts across them
in the most effective way.
STATEMENT OF PROBLEM
What is the profile of the travel agencies in
terms of: type of organization, number of
years in operation , classification of Agencies
?
How do the companies implement the present
marketing activities of the respondents with
respect to product, price, place and promotion
?
What the marketing mix strategies of the
selected travel agencies in term of product
strategies, pricing strategies, promotion
strategies and place strategies ?
What are the major problems facing the
respondents in their marketing mix strategies
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in terms of each variable in the proceeding
questions?
What the possible solution to these problems
to improve the marketing mix of travel
agencies ?
THEORITICAL OF FRAMEWORK
The theory employed in this study is
based on is Bell’s Principle (Bell, Martin 1999)
which state that strategic marketing
management deals with understanding and
accepting owners and top management’s
relevant priorities, their vision, and their
business missions. It provides for an
objectives analysis of the industry and
competition in which the company’s strength
and weakness should be considered, as well
as the industry’s emerging opportunities and
impending threat. Without careful and
periodic updated analysis of these factors,
there is a high risk that resources will be used
inefficiently.
Product. A key distinction between
goods and services is the inseparability of the
later. To buy is simultaneously to use the
services; the customer must present at the
service delivery site. Service organization
must manage the availability of their offering
to smooth demand over time so that demand
matches capacity and that the organization’s
assets are used in ways that will maximize the
return during high and low seasons.
In the low season, tour packages at
appealing prices are used to attract group or
conventions. In demand season, group are
less desirable because guests who will pay top
dollar, travel to Florida on their own (Kotler,
Philip 1984:75)
Pricing. Pricing services lays two
essential roles: (1) to influence consumer
perception and (2) to use in capacity
management. The capacity management role
of prices is also important to service
companies. Many of them use off-peak
pricing which consists of changing differing
prices as a function of the variations in service
demand during different times of the day or
days week.
Place (Distribution). Place or
distribution is a major factor in developing
service marketing strategy because of the
services from the producer. Rarely are
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intermediaries involved in the distribution of
a service; the distribution sites in service
deliveries are the tangible component of the
service.
Promotion. The value of promotion,
specifically advertising of many services, is to
show the benefits of purchasing the services,
such as the outcome of using United Airline.
It is valuable to stress consistent quality and
efficient, courteous service. In most cases,
promotional concern of services is similar to
product.
Marketing success depends on the
development of sound marketing mix plan.
Once the company has decided upon its
positioning strategy, it is ready to begin
planning the details of marketing mix. The
marketing mix consists of everything the firm
can do to influence the demand for its
product.
SIGNIFICANCE OF THE STUDY
This study that it hoped, will be
significant to the management of the travel
agencies considering their marketing
operation. The recommendation may serve as
frame of reference in designing their strategy,
plans, and programs.
This study will also be valuable in
determining the strength and weakness of the
marketing strategies of the travel agencies.
And it may pinpoint some defects which can
open opportunities for corrective action and
proper direction for the improvement. It is
also hoped that the study will be useful to
administration and management of airline
companies in order to have close net working
with the travel agencies.
Scope and Limitation of Study
The main objective is limited to
finding out the perception of marketing
personnel of selected travel agencies on the
four marketing mix factors, namely: Product,
place, price, and promotion; and to
determining the extend to which the four
variables are implemented by the companies
activities. Furthermore, the study is delimited
to the marketing aspect of travel agencies. The
marketing aspect covers also the travel agency
present activities such as service features,
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pricing, promotional activities, etc. The
respondents are likewise limited to managers
and presidents of the travel agencies since
most of these companies do not employ
marketing staff.
Method of Research
The study used the descriptive
method of research. The descriptive method
of research is the type which looks into
profile, events that foretell and project future
trends utilizing the survey approach.
The Research instrument
The researcher used the following
instrument to facilitate the gathering of data
1. Questionnaires
The researcher prepared a questionnaire in
check list form which seek secure uniform
responses. The questionnaire is a form
which seeks to answer the questionnaire
regarding the marketing mix used by the
companies
2. Interviews
Unstructured interviews were conducted
among some of the general manager of
travel agencies after they answer the
questionnaire in order to substantiate the
response in the questionnaire
Sources and Gathering of Data
The primary sources of data are travel
agency personnel, using a questionnaire.
Secondary data come from documentary
literature, gathered from the Department of
Tourism, Securities and Exchange
Commission (SEC).
Brochures, books, magazines and
publication proved very useful sources of
information.
Sample Size and Sampling Technique
The respondent companies were
purposely chosen. The criteria used in
selecting respondent companies were:
1. They were travel agencies which were
located in Makati area
2. They were travel agencies which were
accredited by Department of Tourism
3. Member of IATA (International Airline and
Travel Association) and non IATA
There were 52 travel agencies located
in Makati area as accredited
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by the Department of Tourism. Out of these,
the researcher got 31 respondents who
cooperated in the survey.
Statistical Treatment of the Data
The responses to the questionnaires
are tallied, tabulated, and interpreted through
the use of frequency distribution, percentages,
and t-test.
1. Percentage. The data gathered were be
organize and presented using the frequency
distribution method with the formula:
P (%) = n/N x 100
Where:
P = percentage
n = number of responses falling under a
particular category
N = Total number of respondents
2. Frequency. It is actually the number of
responses to a specific question or item in
the questionnaire
3. Weighted Mead. The weighted mean is also
computed and the liker scale is used as the
basis for the interpretation of data. The
concept of boundary of numeral is
arbitrarily presented below
Range Weigh Interpretation
4.50 - 5.50 5
Most Important or Most
Effective
Very important or very
3.50 - 4.50 4
Effective
2.50 - 3.50 3 Important or Effective
1.50 - 2.50 2
Less Important or less
Effective
Unimportant or Less
0.50 – 1.50 1
Effective
Review Related Studies and Literature
On related literature and Studies, the
researcher has viewed the writings of the
following authors, whose reviews or ideas are
found relevant to this study.
Chuck Y. Gee, Kevin.B.Rober, Dexter J.L.
Choy and James C. Makens for their views on
the four of marketing mix variables in travel
agencies
William J,Stanton for his views on the four P's
of marketing Mix and this four variables are
interrelated where decision in one are usually
affect action in the others.
Philip Kotler for his view that the marketing
mix as the mixture of controllable marketing
variable, where in the manager has control
over the activities in the company or
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organization to achieve a defined goal. He 5. Erlinda B. Businos made studies on the

also wrote that knowing the market target is four P's of marketing as perceived by the
important before deciding on price. personnel.
Victor T.C. Middleton for his vies on the four
variable of the marketing mix DISCUSSION
Martin L. Bell discussed the four step in Profile of the travel Agencies
development of marketing strategy which 1. Type of Organization
related to present studies. Table 1
Larry J. Rossenberg gives his opinion the need Types of Business Organization
to balance between profit for the company Type Number Percent
Sole Proprietorship 3 9.67 %
and the client's satisfaction in price setting.
Corporation 28 90.33 %
E. Jerome McCarthy and William d. Perrault Total 31 100.00 %
Jr. explain the dependence of price policy on Source : by research
objectives, as well as the three methods of
promotional selling As shown, a great majority 28 or 90.33
Isabelo T. Crisostomo gives his views on the percent of travel agencies is corporation and 3
factors to be considered in the selection of or 9.67 per cent are sole proprietorship
media in promotion activities. The predominance of corporations
Lilia B. Arante and Julita Gomez emphasize reflect the essential need for a travel agencies
that salesman should have good knowledge to posses a juridical personality. There are
of the product to be more effective in his advantages of being a corporation. A
selling works corporation can only act within the power
Ignacio emphasizes on marketing expressly mentioned by law or mentioned by
management in the area concerned with the articles of incorporators granted by the
decision and policies relating to marketing Securities and Exchange Commission. As a
activities under marketing program. corporation, the travel agency becomes a very
legitimate body to represent its clients
On related studies, the researcher has 2. Number of Years in Operation
reviewed the writing of the following Table 2
authors, whose finding is found relevant to Number of Years in Operation
this study. Years Number Percent
1. Diksotoma Ian Bagus Putra concludes in 5-6 5 16.13 %
his finding that the travel agency business 7-8 6 19.36 %
in Indonesia is more profitable where the 9- 10 2 6.45 %
internal rate of return is 90 percent. Above 10 years 18 58.06 %
2. Sahat P. Siahaan mentions the target Total 31 100.00 %
market of the travel agency was Source : by research
recruitment agencies and multinational
companies for marketing strategies. A great majority 58.06 percent have
3. Gerhard Von Haunschild cites that the been operating for more than 10 years
component and characteristic of the
tourism industry to develop a system 3. Classification of Agencies
model for international tourism is by
having the key element of the system The travel agencies are classified into
which include the product, 2 divisions: IATA (international Airlines
environmental, market, consumer and Travel Association) member and non IATA.
distribution channels. The IATA agencies which numbers of 22 or
4. Jose M. Conde focuses his studies on the 70.97 per cent are associated with the
effect personal selling in specific International Travel Association. They have
marketing strategies. been in existence for than twenty eight years.
The source of income of IATA agency is

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mainly company accounts, since it depends distributing the product/ services, in this
on the membership of many association regard it has been done to find out the
factors that can influence the choice of
place. A majority of travel agencies choose
Table 3 the number of customers as the highest
Classification of Agencies factors in their selection of place and
Classification Number Percent subsequently followed by urban area,
IATA Member 22 70.97 % geographic concentration and size order.
Non-IATA 9 29.03 % The location of customers is the primary
Total 31 100.00 % consideration taken by the respondents.
Source : by research Due to competition, proximity to the market
is important, like tourist spots areas and
On the other hand, the non-IATA business centers are thus flooded with
agencies which number 29.03 per cent are not travel agencies.
member of International Travel Association. Table 4
They do not belong to any sales association a Selection of Place
majority of their sales come from immigrant’s Number Percent
visa holders
Number of 28 37.84 %
There are advantages of being a customers.
member of the IATA. Since the IATA is an
association of airlines, it is the agency that Urban area. 27 36.48 %
standardizes the plane fares of the member of
Geographic 12 16.22 %
which almost all airlines are member. Since a concentration of
travel agency earn mainly from commissions Market
or discount given to it by the airlines, it is
imperative that a travel agency become a Size order 7 9.46 %
member of IATA. The travel agencies that are
members of the IATA can offer more efficient Total 74 100.00 %
and faster services to its customer because Source : by research
they can deal directly with the airlines.
4. Promotion
The present activities of travel agencies in A majority of travel agencies use external
connection with marketing mix with regard promotion and only 32.26 per cent provide
to product, price, place and promotion internal promotion.
1. Product / Service
The agencies offer five basic services to their Table 5
customers, the services are reservation and Types of Promotion
ticketing, documentation of travel papers, Type Number Percent
acquisition of passport, acquisition of visas
External 21 67.74 %
and tours (domestic and international)
Promotion
2. Price
The travel agencies receive commissions Internal 10 32.26 %
from airline companies in selling tickets. Promotion
This enables the agencies to grant discount
to their clients. A great majority of Total 31 100.00 %
respondent travel agencies gives 5 percent Source : by research
discount to their customers and the lowest
rate given is 3 percent With regard to advertising media is
3. Place/Distribution utilized, the use of billboard are the most
When decision is made to open a branch, common form of advertising, followed by
the logical is to select the place for brochure and newspaper. Very few

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engage in magazine and television. The x = 4.66 ( MI )

cost of advertising is very expensive Source : by research
particularly television, magazine and
newspaper advertising. The second rank is to competently
Table 6 satisfy the needs, wants and expectation of
Advertising Media Used the customers 94.67 or most important0,
maintain customer loyalty (4.58 or most
Medium Number Percent important) and attract more customers (4.55
Television 2 3.85 % or most important)
Newspaper 9 17.31 % To maintain customer’s loyalty is
essential for the company in keeping up with
Magazines 7 13.46 %
the competition in industry especially with
Billboard 21 40.38 % the new comers and it is even difficult or
Brochure 13 25.00 % harder to keep the customer loyalty rather
Total 52 100.00 % than to catch them. In general, respondent
believe that all the factors mentioned are most
Source : by research important in achieving the product objectives.
All the four factors are directly aimed at the
Marketing Mix Strategies of the
Respondents Companies with Respect to customers and how to effectively serve them
Product, Price, Place and Promotion continue their patronage.
With regard to product strategies, the
Product Strategies. first rank of the respondents' choice is to offer
many form services which provide a certain
Table 7 presents product/ service purpose (4.52 or maximum effect). The
objectives. It shows that all of the company offer many types of services. These
components in product objectives were include ticketing, booking for the airline,
considered as most important. The first rank
acquiring passport and visas, consultation on
in product/service objective is to maintain
quality service strategy 94.84 or most how to get an immigration visa, booking for
important, it is an important element in hotels, domestic and international tour and
maintaining the company company's good other services concerning traveling.
reputation and serves as competitive weapon
that can result in increased market share of Table 8
the firm. Product/Service Strategy
Table 7
Components Interpr Rank
Product/Service Objective etation
Components AWM Interpre- Rank AWM
tation Offer many types 4.52 ME 1
Maintain customer of service which
loyalty 4.58 MI 3 provide certain
purpose
Maintain quality 4.84 MI 1
service Offer related 2.9 ME 3
insurance
Attract more 4.55 MI 4 services
customers
Offer wide range 4.42 ME 2
To ompetently satisfy 4.67 MI 2 of customer
the needs, wants, and services
expec tationofthe
customers Legend : AWM: Average Weighted Mean
Legend : AWM: average weighted mean x = 3.96 (Great Effect)

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Source : by research Legend: AWM: Average Weighted Mean

x = 4.17 (Very Important )
The second rank is to offer wide The objective component was rank as follows:
range of customer service, the agency will Rank first is to maintain reasonable
render extra service such as seeing to it that rate of return (4.55 or Most Important), that
the customers will leave without hustle, it will believe that this element is necessary since it
also coordinate with tour agencies with create good chance in setting the price to keep
regards to problems of tourist so that these the companies always profitable. Rank
will acted upon earlier. Another strategy is second is maximizing profit in the long run
to offer related insurance services which (4.52 or most important), some companies
satisfactory effect considered, willing to forgo immediate profit in order to
A product strategy adapted by the penetrate more competitive market in the
travel agencies is to keep themselves abreast future. The other strategies are to increase
with the competition by offering as many market share (4.32) is very important), they
services that shall answer specific purposes a believe that the higher sales volume will lead
client may need. to lower unit cost, and higher long-run profit.
It can be observed the following price
Pricing Strategies objectives components were also very
important considered: maximum current
With regard to pricing objectives, the profit; meet competitors pricing and survival.
companies need some basis in setting up their
price. The findings of this matter are Table 10
presented in table16, which shows the mean Pricing Strategies
values and interpretation expressed.
It can observed in table 9 that there Components AWM Interpre- Rank
are most components that were considered as tation
most important, those maximizing profit in
Setting prices 3.39 SE 1
the long run and maintain reasonable rate of
close to cost
return.
Table 9 Setting prices 3.32 SE 2
Pricing Objectives lower than the
other
Competitors
Components AWM Interpre Rank
tation
Low cost due 2.58 SE 4
Survival. 3.61 VI 6
to few benefit
offered
Meet competitors 3.97 VI 5
pricing.
High prices .90 SE 3
with a lot of
Maximum 4.03 VI 4
benefits
current profit

Maintain 4.55 MI 1 Source : by research

reasona-ble rate
of return Table 10 present pricing strategies. It
shows that all components are considered as
Maximizing 4.52 MI 2 satisfactory effect. The respondent's
profit in the long preference of the pricing strategy depend
run upon their existence in the market, some
companies with greater market share may
Increase market 4.32 VI 3
maintain their price for the quality image.
share
The first ranks setting is setting price close to

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cost (3.39), this strategies were adopted since
the companies want to increase more market
share in the future so they set up a price that
lead to higher sales volume by lowering its
unit cost. The second rank is setting prices
lower that the other competitors; third rank is
high prices with a lot of
benefit such as immigration assistance;
related insurance coverage and the last rank
are low cost due to few benefits offered.
The respondents give high value or
priority to their reputation as means to
increase sales and market share, this could be
achieve only by maintaining customer loyalty
and this may not possible without giving their
best service quality. Inform the customer
about the advantages of services being offered
and to persuade customer to purchase
product/service were rated as very important
component

Promotion Strategy There were five components rate as

Maintain good reputations of the
company, to increase sales and to increase
market share are considered as most
important components, however among these
the three components its shows that maintain
good reputation of the company was ranked
as number one, since the customers believe in
their good service quality
great effect components in promotion
strategies, those are: using direct marketing,
using special promotion tools to reach the
potential customer, special discount during
special occasion, continuous promotion and
finally update various promotional tools after
a certain period. while low cost in promotion
tools was rated ad important.

Table 11 Table 12
Promotion Objectives Promotion Strategies

Components AWM Interpre Rank Components AWM Interpre Rank

tation tation
Using direct 4.09 GE 1
Inform the 4.45 VI 4 Marketing
customer
about the Special 3.90 GE 3
advantages of discounts
the services during special
being offered occasion

Maintain good 4.84 MI 1 Low cost in 3.42 SE 6

reputations of promotional
the company tools

To persuade 4.39 VI 5 Continuous 3.87 GE 4

customer to promotions
purchase the
product or Update 3.65 GE 5
service various
promotional
To increase 4.74 MI 2 tools after a
sales certain period

To increase 4.64 MI 3 Using special 4.00 GE 2

market share promotional
tools to reach
X = 4.61 (Most Important) Sd = 0.19 the potential
Source : by research customer
Source : by Research

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As shown direct marketing was given customer account so their loyalty is the main
high value by respondents company, since concern most of all.
most of the travel agencies have their own
costumer account or regular customer so this The Major Problem Facing the Respondents
strategy is very much applicable in industry. in their Marketing Mix Strategies in term of
Low cost in promotion shows the least rank Product/service, Price, Promotion and Place
among the other elements in promotion
strategy, this is because it will not give good Problem in Product/ Service
effect to overall marketing strategies. The Those problems that were agreed by
most widely used promotion tool by travel the respondent travel agencies are: difficulties
agencies is direct marketing Client seem more in satisfying customer; financial difficulties
comfortable personally availing themselves of caused by high cost due to a lot of benefits
the agencies products and services. As such, offered and wrong perception of customer
the promotion strategies utilized are in line of with regard to service rendered by travel
direct marketing. agencies i.e. in producing fake documenta-
tion.
Place Strategy
Deliver service easily and increase Table 14
market share were rated as most important, Problem in Product/Service Strategies
Just in time and safe delivery was considered
as very important. Delivery service easily is Components AW Interpret Rank
the priority in distribution objective since the M ation
company dealing mostly with traveling Difficulties in 2.70 Agree 2
document it needs immediate attention to satisfying
satisfactory outcome. customer needs
& preferences
Table 13
Place/ Distribution Objectives Wrong 2.52 Agree 3
perception of
Components AW Interpr Rank customer with
M etation regard to service
Increase 4.48 MI 2 render by travel
market share agencies e.g. in
producing fake
Deliver service 4.55 MI 1 documentation
easily
Negative image 2.18 Disagree 4
Just in time and 4.42 VI 3 of travel agency
safe delivery
High cost due to 2.95 Agree 1
x = 4.48 Sd =0.06 additional benefit
Source : by Research affecting financial
difficulties
With regard to place strategies
components, as pinpointed in the table 21 it Lack of services 2.09 Disagree 6
shows that all the components were great give to the
effect considered. customer
The first rank respondents’ choice
2.10 Disagree 5
was to focus on the group of potential
customer who appropriate to particular Change image
service offered; this is because most of the due to a lot of
respondents companies have their own benefits offered

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x = 2.4 (Disagree) Sd = 0.36 this does not hold true in many situation like
Source : by Research those companies with have stable market.
Promotion Strategy Problems
Too many benefits offered by the
Respondents strictly agreed that on
company may not necessary for some the occurrence of problems like: travel
customers especially when it will lead to high agencies are spending high cost of promotion;
price so the companies found difficulties in severe competition in promotion,
satisfying their customer, while wrong
perception of customer with regard to the Table 16
service rendered is due to perception of some Problem in Promotion
customer that travel agencies could produce Components AWM Interpre Rank
tation
working visa in foreign country.
High cost of 3.41 Agree 1
promotion

Problem in Pricing Ineffective 2.96 Agree 3

advertising
Table 15
Problem in the use of Pricing Strategy Weakness or lack 2.64 Agree 4
of oopera-tion of
company sales
Components AWM Interpre Rank
forces
tation
Declining in Severe
prices due 3.12 Agree 1 competition in 3.00 Agree 2
promotion
from price
cutting due
x = 3.00 (Agree) Sd = 0.32
to stiff Source : by Research
competition
Ineffective advertising; and weakness
Validity of or lack of cooperation of company sales
prices quoted 2.81 Agree 3 forces. Since high cost of promotion was given
to tax the highest rank in promotion problems so it
is understandable that the majority of travel
Associated agencies use billboard as their common form
of advertising media.
fees charged 2.83 Agree 2
Place/ distribution Strategy Problems
Legen: AWM ; Average Weighted Mean Table 17
x = 2.9 (Agree) Sd = 0.17 Problem in Place
Source : by Research Components AWM Interpre Rank
tation
Table 15 discloses the problems Competition from 3.00 Agree 2
similarly located
encountered in the use of pricing strategy. travel agency
The three problems encountered were agreed
by the respondents, but among them Stiff competition to
tap new market 3.12 Agree 1
declining in prices arising from price cutting area
due to stiff competition was placed as the
foremost. Lack of cooperation
between
Price cutting is the most common International 2.85 Agree 3
reaction of many companies when they faced airline offices with
travel agencies
strong competition in the industry, however offices

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Dikta Ekonomi Jurnal Ekonomi dan Bisnis

x = 2.99 (Agree) Sd = 0.13 Source : by Research

Source : by Research
In the use place/distribution strategy, With respect to difficulties in
there are three problems encountered as satisfying customers needs and preferences is
shown in table 17. Stiff competition to tap to compromise with customer by explaining
new market area rank first, this is due to rapid the advantage and disadvantage of the
increased of travel agency in the country. product or service offered. This is to keep
customers informed of the benefit offered
The possible solutions to the problems in
with the product or services, thus
order to improve the marketing mix strategies
of the travel agencies coordination among the marketing personnel
to inform the customer needed.
Possible Solutions of Product/Service In relation to wrong perception
Problem among the customer with regard to services
Table 18 rendered in producing fake documentation
Possible Solutions of Product/Service and negative image of travel agency, the
Problem finding suggested that active public
Components AWM Interpr
information drive be made to improve the
etation
image of travel agency through advertising;
Compromise with 3.50 Agree
association such as Philippine Travel agency
the customer by
explaining the (PTAA) and government unit i.e.
advantages (Department of Tourism) were required and
disadvantages of the necessary. Concerning problems with regard
services offered to high cost due to additional benefits, the
suggested solution is to give the customer
Active public 3.20 Agree clear enumeration of the inclusion of services
information to and information as to why it becomes costly.
improve image of The disparity between client and travel
Travel Agency
agencies perception on services rendered
through: Advertising
must be reconciled by keeping the market
Association i.e. 3.28 Agree aware of the activities being done.
PTAA
Price Strategy Solution
The suggested solution given to solve
Government Unit i.e. 3.35 Agree
the problem regarding declining in prices due
(Department of
to stiff competition was to establish standard
Tourism)
prices through government co-sharing or
joint sharing of cost with other fellow travel
We should 3.43 Agree
agency ; match the prices with their travel
enumerate to
agencies and give customer low prices but
passenger the
increase the volume of sales.
inclusion of services
Today, travel agencies are facing a
become high cost due
to a lot of benefit very tough competition in the market so, low
offered prices are common problem, it can be
suggested that non-price factor should be
Establish & give 3.21 Agree considered in determining buyer-choice
more additional behavior i.e. giving best service quality factor
services should be emphasize or place as priority
x = 3.36 (Agree)

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activities that could produce the highest

return and reducing unnecessary expenses on
Table 19 the potential market and also select the most
Possible Solution to Pricing Problem effective tools in advertising activities. The
Components AW Interpr Rank suggested solution with regard to problem in
M etation weakness or lack of cooperation of company
Give the 3.23 Agree 3 sales force, the suggested solution was to
customer low develop more cooperation with the company
prices but sales force in order to obtain accessibility of
increase the information needed.
Volume of sales
Table 20
Give the 3.28 Agree 2 Possible solution in Promotion Problem
customer high (Weakness or Lack Cooperation of Company
price but we give Sales Force)
the best Quality
Components AWM Interpret Rank
Co-sharing or 2.54 Agree 7 ation
joint sharing of
cost with other Develop 3.48 Agree 1
fellow Travel more coo-
Agency perative with
company
Use direct mail 2.69 Agree 6 sales force
service
Abolish all 1.91 Disagree 2
Need to develop 3.17 Agree 5 advertising
creative activities
Inexpensive ways x = 2.69 (Agree)
in Charging of Source : by Research
fees
Place/Distribution Strategy Solution
Establish 3.35 Agree 1
standard prices Table 21
through govern- Possible Solution in Place Problem
ment Institution Components AWM Interpr Rank
or association etation
Established 2.96 Agree 2
Match the prices 3.18 Agree 4 intensive
with other travel distribution
agency. as many
x = 3.06 (Agree) branch as
Source : by Research (possible)

Promotion Strategy Solution Compromise 3.17 Agree 1

between
Since the promotion problems are International
interrelated to one another nevertheless the flights offices
agencies should make feasibility studies and And travel
financial forecast before getting into any agency
promotional plans; selection in promotional x = 2.90 (Agree) sd = 0.38

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Dikta Ekonomi
Source : by Research
The companies should look for a
group of potential customer that have not
been touched by other company and
established intensive distribution in main
branch as possible in order to solve the
problem on competition from similarly
located travel agency and stiff competition to
tap new market area. In relation lack of
cooperation between international airline
offices and travel agencies offices, the possible
solution could be that the agency compromise
between international airline and travel
agency, so this problem could be minimized.
CONCLUSION AND RECOMMENDAION
Conclusion
In the light of the foregoing findings,
the following conclusion has been made.
1. Profile of The Travel Agencies
A great majority of travel agencies are
corporation. This type of business
organization was preferred over the other
types, since a corporation is more stable
than partnership and sole proprietorship
whose existence depends so much on the
owner. The predominance of corporation
reflect the essential need for travel agencies
to posses a juridical personality. The
majority of travel agency have been in
business for more than ten years, this mean
that they are not young enterprises which is
an indication of their strong foundation in
the industry. The majority of travel
agencies are belong to International Airline
Travel Association (IATA), since being an
IATA member give many benefit to the
industry
2. Present Marketing Activities
There are five basics rendered by travel
agencies, these are reservation and
ticketing, documentation of travel paper,
acquisition of passport, acquisition of visa
and tours.
3. The travel agency grants discount to
customer, majority of them gave five per
cent and the lowest rate offered is three per
cent. It can be said that competition is very
strong among the agencies when it comes to
discount given. Majority of travel agency
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Jurnal Ekonomi dan Bisnis
choose the number of customers as the
highest factor in their selection of place.
Due to competition, proximity to the market
is important, like tourist spots areas and
business centers are thus flooded with
travel agencies. With regard to
promotion activities it shows that there is a
lack of sound of marketing strategies
particularly in advertising, since only
billboards are being used by most majorities
of travel agencies.
4. Marketing Mix Strategies
Product
Offer many of services which provide
certain purpose were given the highest rank
product strategies. This can be concluded
that the travel that the travel agencies
should keep themselves abreast with the
competition in the industry by continuous
study of the customer’s need especially
with regard to product/service line offered.
To maintain quality service were given high
value in product/service objective, since
this is an important element in maintaining
the company’s good reputation and serves
as competitive weapon that can result in
increased market share of the firm.
Price
All components in pricing strategies were
rated as having satisfactory effect which is
congruent to their price objectives. It can be
concluded that the respondent did not give
much emphasizes in any particular element
of pricing strategies, since it seemed that the
respondent are aware of the flexibility of
strategies being used so that their price are
competitive enough with their competitor.
Promotion
Using direct marketing was given the
highest rank in promotion strategies. This
due to that most of the travel agencies have
their corporate account or fixed customers
so this can be concluded that this strategy is
very much applicable in the industry.
In promotion objectives, there are three
components were related to one another
and they were rated as most important.
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Dikta Ekonomi
Among the three components, to maintain
good reputation of the company was given
the highest rank. This can be concluded
that the respondent give high value or
priority to their reputation as a means to
increased sales and market share.
Place
In place strategy, to focus on the group of
potential costumer who appropriate to
particular service offered was given the
highest rank, this is due to most of the
travel agencies have their own corporate
account or fixed costumer. This can be
concluded that their loyalty is the main
concern of all To deliver service easily
was given the highest rank in
place/distribution objectives. Since the
company dealing mostly with traveling
document, so naturally it needs immediate
attention to meet satisfactory outcome.
Major Problems Facing by The Respondents
in Their Marketing Mix Strategies and Their
Possible Solution
Product
High cost due to additional benefit affecting
financial difficulties was given the highest
rank in product problem. This is because
too many benefit offered by the company
may not needed or necessary for some
customers, especially when it is will lead
lead high price.
Price
Declining in prices from price cutting was
given the highest rank in price problem. It
can be concluded that in general many
companies adopted the same reaction when
they were faced by strong competition in
the industry
Promotion
High cost of promotion was given the
highest rank in promotion problem. Since
majority of travel agencies used billboard as
their most common form of advertising, so
it can be concluded that others advertising
media i.e. (magazines and television) which
need higher cost than billboard are rarely
used by the agencies.
Place
Stiff competition to tap new market area
was found to be the highest rank in place or
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Jurnal Ekonomi dan Bisnis
distribution problems, this due to rapidity
of the growth of travel agency in the
country.
5. The Possible Solution To The Problems to
Improve The Marketing Mix Strategies
Possible Solution To Product/Service
Problems
Compromise with customers by explaining
the advantage and disadvantage of product
or service offered are necessary due to the
belief that many customers may not aware
of its benefit. For the problem of high cost
due to additional benefit, the employees of
travel agencies are necessary to give the
customer information and clear
enumeration of the inclusion of services to
rationalize the high cost.
Possible Solution To Price Problems
Since declining in prices due to stiff
competition are common problem among
the travel agencies, it can be suggested that
non-price factor i.e. giving best service
quality factor should be emphasize or place
as priority
Possible Solution To Promotion Problem
Since the promotion are interrelated to one
another nevertheless the agencies should
make feasibility studies and financial
forecast on the potential market and also
select the most effective tools in advertising
activities.
Possible Solution To Place Problems
The companies should look for a group of
potential customer that have not been
touched by other company and established
intensive distribution in order to solve the
problem on competition from similarly
located travel agency and stiff competition
to tap new market
Recommendation
In the light of foregoing finding and
the conclusion drawn, the following
recommendation are offered by the
researcher:
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Dikta Ekonomi
1. It is advisable for all travel agencies to
join the International Airline travel
Association (IATA), since IATA strive to
producing safer, more regular, more
economical air transport and the airline is
able to provide the best possible range of
facilities to all categories of consumer and
also to permit the carrier to harmonize
and standardize their procedures, thus
reducing cost while making air transport
easier for the customer.
2. With regard to stiff competition in prices,
travel agencies should find a way for their
business services to be distinct from the
other competitors by giving more value
added to their services such as by giving
best and standardized services to their
customers: i.e., customer must not wait
for more than two minutes to see the
information asked and to see the final and
detailed amount of his bill. In
advertising, the travel agencies should
emphasize more the promotion of their
services and the expenses incurred may
be cut down by engaging in promotional
tie-up with airline companies in tour
expectation.
3. On the marketing mix strategies of travel
agencies in term of:
Product -- To maintain quality services
the travel should have continuous study
of their customer's needs, strengths and
the weakness of the services offered by
asking some feedback from their
customers. It is also recommended that
the company should ensure the consistent
standard of the quality of their service in
all form, such as the demeanor and
personality of employees; impressive
facilities and office environment etc.
Price -- It is recommended that the
company must continuously review their
prices in order to meet the flexibility of
the price changes in the industry by
thorough study of the internal and
external factors in pricing. In Internal
factors the agencies should study the
company's cost as well as the company's
objective; while for external factor, study
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Jurnal Ekonomi dan Bisnis
the market demand and competition
among the other travel agencies.
Promotion -- It is recommended that
during the lean season, the agencies
engage in special tours at special package
to lure more travelers. This may be
coupled with promotional devices
intended to boost value.
Place -- Place or distribution strategies are
structured by company's goals and
objectives. It is recommended that an
assessment of the market opportunities to
formulate a systematic step approach be
taken.
4. On the major problems encountered in
marketing strategies and the possible
solution these problems.
Product -- On the problem of high cost
due to additional benefit, it is
recommended that travel agencies should
emphasize the benefit of product or
service being offered, their differences in
perception on service rendered must be
reconciled by keeping the market aware
of the activities being offered.
The companies should compromise with
customers by explaining the advantage
and disadvantage of the product or
service offered to solve problems in
difficulties in satisfying customer needs
and preferences.
Price -- With regard to the problem of
declining in prices from price cutting, it is
also recommended that the travel
agencies should agree on more
standardize price setting.
Promotion -- The respondents should
forecast the possible activities in
advertising as to promote their services
offering more maximize. Advertising
should be utilized by the agencies to
promote their services offering.
However, expenses may be cut down by
engaging in promotional tie up with
airline companies in tour operation.
Place -- With regard to stiff competition to
tap new market area, it is recommended
that the company should look for a group
of potential customers that have not been
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Dikta Ekonomi
touched by other companies and establish
intensive distribution.
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